Correlation Between Quarterhill and Stingray

Can any of the company-specific risk be diversified away by investing in both Quarterhill and Stingray at the same time? Although using a correlation coefficient on its own may not help to predict future stock returns, this module helps to understand the diversifiable risk of combining Quarterhill and Stingray into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Quarterhill and Stingray Group, you can compare the effects of market volatilities on Quarterhill and Stingray and check how they will diversify away market risk if combined in the same portfolio for a given time horizon. You can also utilize pair trading strategies of matching a long position in Quarterhill with a short position of Stingray. Check out your portfolio center. Please also check ongoing floating volatility patterns of Quarterhill and Stingray.

Diversification Opportunities for Quarterhill and Stingray

0.32

Correlation Coefficient

Quarterhill  Stingray

Weak diversification

The 3 months correlation between Quarterhill and Stingray is 0.32. Overlapping area represents the amount of risk that can be diversified away by holding Quarterhill and Stingray Group in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Stingray Group and Quarterhill is a relative statistical measure of the degree to which these equity instruments tend to move together. The correlation coefficient measures the extent to which returns on Quarterhill are associated (or correlated) with Stingray. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Stingray Group has no effect on the direction of Quarterhill i.e., Quarterhill and Stingray go up and down completely randomly.

Pair Corralation between Quarterhill and Stingray

Assuming the 90 days trading horizon Quarterhill is expected to under-perform the Stingray. In addition to that, Quarterhill is 1.04 times more volatile than Stingray Group. It trades about -0.03 of its total potential returns per unit of risk. Stingray Group is currently generating about 0.09 per unit of volatility. If you would invest  787.00  in Stingray Group on December 5, 2024 and sell it today you would earn a total of  76.00  from holding Stingray Group or generate 9.66% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Very Weak
Accuracy	100.0%
Values	Daily Returns

Quarterhill  vs.  Stingray Group

Quarterhill

Risk-Adjusted Performance

Very Weak

Over the last 90 days Quarterhill has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of very healthy basic indicators, Quarterhill is not utilizing all of its potentials. The recent stock price disarray, may contribute to short-term losses for the investors.

Stingray Group

Risk-Adjusted Performance

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Stingray Group are ranked lower than 6 (%) of all global equities and portfolios over the last 90 days. In spite of comparatively unfluctuating basic indicators, Stingray may actually be approaching a critical reversion point that can send shares even higher in April 2025.

Pair Trading with Quarterhill and Stingray

The main advantage of trading using opposite Quarterhill and Stingray positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Quarterhill position performs unexpectedly, Stingray can make up some of the losses. Pair trading also minimizes risk from directional movements in the market. For example, if an entire industry or sector drops because of unexpected headlines, the short position in Stingray will offset losses from the drop in Stingray's long position.

The idea behind Quarterhill and Stingray Group pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.

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Note that this page's information should be used as a complementary analysis to find the right mix of equity instruments to add to your existing portfolios or create a brand new portfolio. You can also try the Portfolio Diagnostics module to use generated alerts and portfolio events aggregator to diagnose current holdings.